West News Wire: According to the deputy governor of the Central Bank of Iran (CBI), as many as 700 Russian banks and 106 foreign banks from 13 different countries are able to communicate financially with Iranian banks.
On Sunday, the central banks of Iran and Russia agreed to link their respective national interbank communication and transfer systems in order to facilitate two-way bank transfers and promote commerce.
According to Mohsen Karimi, “under the agreement, the national banking messaging systems of the two nations were linked, enabling all member banks of the national banking messaging system of Iran to exchange banking messages with all banks in Russia.”
Financial institutions in the two nations can use the system to open letters of credit, process money orders, and bank guarantees. This means they do not need the SWIFT international messaging system for payments, Karimi said.
“By connecting the national messaging systems of Iranian and Russian banks, about 700 Russian banks can exchange financial messages with Iranian banks. Apart from these Russian banks, 106 non-Russian banks from 13 other countries can connect with this messaging system and have financial exchanges with Iranian banks.”
To begin with, a bank from Iran and another from Russia were chosen to exchange the first message, Karimi said, adding a technical delegation of the central bank of Russia will travel to Iran in the comings days to provide the groundwork for communication and dispatch of messages among all banks of the two countries.
According to the CBI website, 52 branches of Iranian banks and four unnamed foreign banks will use Iran’s local interbank telecom system or SEPAM to connect with 106 banks using Russia’s system for transfer of financial messages or SPFS.
On Saturday, a senior Iranian trade official said Russia has overtaken China as the biggest investor in Iran.
Since Iranian president Ebrahim Raeisi’s administration took office in August 2021, according to Ali Fekri, chairman of the government-run Organization for Investment and Economic and Technical Assistance of Iran, Russia has invested around $2.7 billion in two oil projects in the western province of Ilam.
The following major investors included China, Afghanistan, Turkey, and the United Arab Emirates.
Since last year, relations between Iran and Russia have dramatically improved. Numerous high-ranking visits have taken place, and a number of agreements have been made to increase trade cooperation between the two nations.
The US and Europe have imposed severe sanctions on both Iran and Russia, and they have been collaborating to discover ways to get around them.
Fekri claimed that Russia made an investment by either delivering Iran actual cash or by using foreign currency traders.